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CQ: Committee Endorses Small-Business Bill

A House panel advanced legislation on Wednesday that would expand requirements for federal agencies to measure the economic impact of their regulations on small businesses, after defeating a dozen amendments offered by Democrats to scale back the measure.

The Small Business Committee gave voice vote approval to a measure (HR 2542) that would modify aspects of the rule-making process so that agencies regularly review the economic necessity of regulations affecting small businesses. The bill is among several the House GOP has advocated this year to limit the potential impact of regulations issued by the Obama administration.

The legislation would modify the Regulatory Flexibility Act (PL 96-354), which requires agencies to examine the impact of regulations on small businesses. It would direct agencies to measure both direct economic effects and “reasonably foreseeable” indirect economic effects of regulations on small businesses. Additionally, it would require agencies to convene review panels when proposing rules that are considered likely to cause significant economic impact.

“While the economy has limped along over the past four years, the ability of small businesses to grow and create jobs has been hampered by the ever-increasing regulatory burden,” said Chairman Sam Graves, R-Mo. “This means «small businesses» must spend more time, money and resources to comply with regulations.”

Ranking Democrat Nydia M. Velázquez of New York countered that the legislation would be counterproductive and costly.

“The fact is that adding additional bureaucrats in tinkering and authoring regulations will cost money,” she said. “With this bill’s $100 million price tag ... I question the wisdom of spending this money.”

The committee rejected 12 out of the 16 Democratic amendments offered, including a proposal that would allow the Small Business Administration’s chief counsel for advocacy to determine whether companies qualify as «small businesses» only if it has certified that it has sufficient funding and personnel for the additional workload. The amendment, by Patrick Murphy, D-Fla., was defeated by voice vote.

The panel also rebuffed, 11-13, an amendment by Yvette D. Clarke, D-N.Y., that would permit agencies to comply with current law if it is necessary for homeland security interests.

However, Clarke did gain voice vote approval of an amendment that would require a Government Accountability Office study to review whether the SBA’s chief counsel for advocacy has the resources to implement its new responsibilities as directed in the legislation.

Three GOP amendments were also adopted by voice vote, including a David Schweikert, R-Ariz., proposal that would expand the definition on an “indirect economic effect” to include compliance costs that «small businesses incur due to new regulations.

The House passed similar legislation in December 2011, but it never received a vote in the Senate.

Other measures the House GOP has pushed this year also require expanded analyses from agencies on the economic impact of their regulations. The House passed legislation (HR 1062) in May that would require the Securities and Exchange Commission to review how the agency’s regulations affect the economy. Democrats largely opposed the measure, noting that the SEC already conducts cost-benefit analyses of its regulations.